The mining nodes simply take a hash of the latest block from those nodes to work on top of for the current block that they're processing.

sorry but there's no point in continuing this discussion in this thread. you've obviously been misinformed.

mining nodes don't have to take a block hash from non-mining nodes. miners can ignore new blocks coming in from the network and create their own chain in secret, then broadcast this secret chain later once they have the most cumulative proof of work. that's how a "51%" attack works.

They can certainly choose which transactions to process from the mempool, but if they don't build a valid block that the non-mining nodes agree to, then they will have wasted their hash power.

that's all they do. there's no other way for transactions end up in a block. if the majority of miners are working on a chain a node doesn't consider valid, and the node wants to follow a different chain, then the node has to follow some other consensus rules. the node would then not be a "bitcoin" node. in fact this is exactly how the bitcoin forks work.

My statements don't disagree with this. Businesses that accept btc will want to run nonmining fullnodes. Enthusiasts and researchers may want to run a nonmining fullnode.

I agree. I was a little confused then that you linked to an article that was literally titled: "Why non-mining full nodes are a terrible idea." and you claimed that Bitcoin = miners. If you agree that non-mining full-nodes are a critical component of the Bitcoin network, then we can agree there, but it didn't seem as if your post was arguing for that at all.

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The thing about decentralization in a proof-of-work, is that it faces unsustainability and other risks. Every performance tweak, every optimization, every competitive advantage, every newer model of of asic, creates a situation where miners must adapt similiar enhancements to compete. Factor in areas where you get cheap electricity. Miners are ok as long as they operate in the black, but if they can't keep up with costs (higher and higher costs, or btc value doesn't keep pace with costs), they have to shutdown part of the mining operation or they may even entirely have to give it up.

Another thing about decentralization is that there is no agreement on what constitutes decentralization in a proof-of-work crypto. Miners are distributed groups, but we see a trend toward greater and greater centralization base on the factors listed above. Those who support running nonmining fullnodes says the more people that run fullnodes the better: for example, 100 users, 10 miners, and if 90 people are nonmining fullnodes, then you've extended decentralization by including nonmining fullnodes across 90% of users. You limit a protocol blocksize increase base on this decentralized reasoning

The problem with this is that it affects usability. The crucial aspect impacted is infrastructure. The people who believe concentrated pools of miners are ok, given the factors of increasing efficiency that will phase out smaller miners, also believe that decentralization naturally results from a higher blocksize limit, which increases usability. Businesses are the ones who must at least run nonmining fullnodes because they process customer transactions. So greater usability --> more users --> more businesses. Now, you have 1000 users, 10 miners or even more (systems that rent mining power to normal users increase), and 90 businesses that run nonmining fullnodes. The percentage of nonmining fullnodes are lower than in the limited blocksize scenario (10% vs 90%), but that does not make it more centralized then the other scenario.

It seems to a be question of perspective: which situation would actually better defend against centralization?

It seems like you operate with a very black and white perspective.

Since hashrate within mining pools can be fairly dispersed, I don't feel there is a need to have a large number of mining pools, so long as the hashrate within them is fairly decentralized. So long as you have enough mining pools to cover the varying degrees of consesus, then you can withstand various attacks and censorship. Since mining pools are more abstract and application layer entities, it is very hard to censor a mining pool itself even if there are only a few of them. Having a geographically decentralized and disperse group of non-mining full nodes however is even more important since often these groups of nodes need to talk the Bitcoin protocol across the internet and often are businesses themselves that depend on these nodes to run their business. Since these business operate within the jurisdiction of any given nation, it would be much easier to censor non-mining full-nodes than it would be to censor any given mining pool of diverse miners. As I stated earlier, it is this large group of decentralized and geographically disperse non-mining full-nodes that provide a proper check against the mining infrastructure.

Again, I'm not for or against a bigger blocksize at some point. It will need to be an inevitable change to be made to the protocol in order to scale it even with adequate side chain solutions in place. But, I feel like you're straying from the original argument and trying to now squeeze a blocksize debate into the picture where there was none previously. Aside from acknowledging that blocksize increases are not a valid form of scaling exponentially (which is needed for large scale adoption), then I understand the need for blocksizes that are larger than the current restriction today.

However, our original argument was in regard to whether mining is the central form of power within the Bitcoin network and ecosystem and whether or not SegWit introduces security flaws. As I've stated, unless you feel that miners are the sole dictators of Bitcoin, then SegWit does not introduce any more security issues than were already present with the risk of a 51% attack or a contentious hardfork driven by miners. I stand by my position on the fact that non-mining full-nodes are a check and balance against miners and even though you've now strayed into a separate debate altogether (block-size), I haven't heard a valid argument against having that check and balance in place. That check and balance provides security and will ensure that SegWit is a secure part of Bitcoin going forward that can't simply be contentiously removed one day by a malicious group of miners, no matter how strong they think they are.

sorry but there's no point in continuing this discussion in this thread. you've obviously been misinformed.

mining nodes don't have to take a block hash from non-mining nodes. miners can ignore new blocks coming in from the network and create their own chain in secret, then broadcast this secret chain later once they have the most cumulative proof of work. that's how a "51%" attack works.

But they still need to choose a valid block height to operate from as a point of fork. That was my point. They obviously don't need to pull that block from a non-mining node, but that misses the point that they'd certainly need to pull that block from a legitimate chain (whether their own copy or not) in order to present their fork chain for consensus. Otherwise what would be the point of forking?

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that's all they do. there's no other way for transactions end up in a block. if the majority of miners are working on a chain a node doesn't consider valid, and the node wants to follow a different chain, then the node has to follow some other consensus rules. the node would then not be a "bitcoin" node. in fact this is exactly how the bitcoin forks work.

I'm not up for arguing semantics, so please don't underline my sentence and claim like I was stating anything other than what was clearly typed out. We're in full agreement with how transactions end up in a block.

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i don't know what you're talking about. no other chain has ever had the most cumulative proof of work.

I agree we haven't. But that's certainly not without an effort to have one, as was shown with the proposed SegWit2X fork. That was a proposed hardfork that had a majority of hashrate behind it. Had it gone through, it would have been the most cumulative proof of work chain. However, due to the lack of support from the community, the number of non-mining full-nodes in opposition, and the lack of ecosystem support (exchanges, payment operators, etc), then the fork didn't go through (not taking into account that the code itself was screwed up).

However, our original argument was in regard to whether mining is the central form of power within the Bitcoin network and ecosystem and whether or not SegWit introduces security flaws. As I've stated, unless you feel that miners are the sole dictators of Bitcoin, then SegWit does not introduce any more security issues than were already present with the risk of a 51% attack or a contentious hardfork driven by miners. I stand by my position on the fact that non-mining full-nodes are a check and balance against miners and even though you've now strayed into a separate debate altogether (block-size), I haven't heard a valid argument against having that check and balance in place. That check and balance provides security and will ensure that SegWit is a secure part of Bitcoin going forward that can't simply be contentiously removed one day by a malicious group of miners, no matter how strong they think they are.

My stance remains: 1) miners are essential and a central component to bitcoin, because they are the ones who validate transactions and update the ledger in return for coins; 2) as already pointed out, segwit created a point of vulnerability. I haven't been convinced otherwise.

Ughhh, my friend is obsessed with bitcoin and I was this close to investing $3k as experiment money in August but I didnít because I set a goal for my Vanguard account ($100k) and havenít reached that yet. Now Iím kinda kicking myself and wondering if I should invest now or leave the game to the more fearless? (I still wouldnít invest more than $3k max). If I donít do it, will I be regretting it in 5 years?

Ughhh, my friend is obsessed with bitcoin and I was this close to investing $3k as experiment money in August but I didnít because I set a goal for my Vanguard account ($100k) and havenít reached that yet. Now Iím kinda kicking myself and wondering if I should invest now or leave the game to the more fearless? (I still wouldnít invest more than $3k max). If I donít do it, will I be regretting it in 5 years?

BTC when OP asked the question: $7813.50 BTC now: $18211

Gain: +133% CAGR: OMFG

Come on, it only needs to double about 15 more times before everyone holding at least 1 BTC is a USD billionaire. At this surely sustainable growth rate that should happen by this time next year.

Ughhh, my friend is obsessed with bitcoin and I was this close to investing $3k as experiment money in August but I didnít because I set a goal for my Vanguard account ($100k) and havenít reached that yet. Now Iím kinda kicking myself and wondering if I should invest now or leave the game to the more fearless? (I still wouldnít invest more than $3k max). If I donít do it, will I be regretting it in 5 years?

BTC when OP asked the question: $7813.50 BTC now: $18211

Gain: +133% CAGR: OMFG

Come on, it only needs to double about 15 more times before everyone holding at least 1 BTC is a USD billionaire. At this surely sustainable growth rate that should happen by this time next year.

Damn! In August when my best friend tried to get me to buy bitcoin it was $3k and I thought that was too high to buy in. He thought $10k was the ceiling and it would take a year.

open competition between BTC and BCH is good. the actual announcement and start of trading didn't go well, but i don't think that will matter either way in the long run.

my guess is all the people that tried to make a quick buck and sold all their BCH early now regret it because of the current price of BCH. if BCH drops to zero they'll be vindicated but i don't think that's likely.

Forgive me if I'm wrong, but isn't that the complete opposite scenario of most bitcoin investors at the moment? Few people have only a couple hundred dollars of bitcoin, most appear to be hoarding large sums with the intent to use as an investment rather than for any transactions that can be carried out.

The original premise was that bitcoin would have use-cases that would compel people to acquire it to use; and this would therefore escalate demand and value. However, rising use-cases and transactions have shifted to newer, superior crypto. My prediction is that by 2019, bitcoin's market dominance will dip below 50% (it's currently 62.4% and one year ago it was 86%). There will be crypto that will outperform bitcoin; and a few of these crypto have the potential for a huge breakout due to true onchain scalability, mass adoption, and compelling use-cases (superior remittance system, access to online financial services, a platform that allows payment networks to instantly settle and various units of value to be traded with each other, etc).

I recall reading something about how a bank (or some financial institution) was trialling cryptocurrency. One of the team mates was totally into Bitcoin and had personally invested into it but after performing the rigourous tests he decided that it was a bad investment as it takes hours to transact.

I didn't know about the dip in market dominance but I'm also not surprised. That's why I think Dash, Ripple, and other similar crypto will win the day. The only thing is I don't think Dash and Ripple are seriously considered a digital currency as opposed to Bitcoin.

Ethereum might win as well but I have heard they are having some serious problems as well. I'm not too sure about Litecoin though as I'm not sure what its use cases are.

And to be fair to the dot-com boom those companies at least had the potential to make money. Pets.com could have been profitable, at some point. BTC can...eh, function as a highly volatile middle-man to buy starbucks, which is instantly converted to USD.

I didn't post that graph to say whether it is true that we are in a bubble or not, nor whether it would be prudent to invest in Bitcoin or not, but rather about the fallacy of making predictions without hindsight, especially if you were going to act on them (no shorting is available that I know of).

It's a bit of a semantics argument, but I'm not sure one can call a bubble until it is popped. It has to be done with hindsight.

agreed that hindsight is needed to declare bitcoin was "in" a bubble. time will tell if bitcoin altogether "is" a bubble. if you look at the log chart the history appears a lot less dramatic, but it's still climbing at an unsustainable pace:

I didn't post that graph to say whether it is true that we are in a bubble or not, nor whether it would be prudent to invest in Bitcoin or not, but rather about the fallacy of making predictions without foresight, especially if you were going to act on them (no shorting is available that I know of).

It's a bit of a semantics argument, but I'm not sure one can call a bubble until it is popped. It has to be done with hindsight.

Call me a sematics geek, but it's a bubble. It can continue to be a bubble for another 10 years, but it's a bubble, nevertheless. Hopefully, many can make fortunes before the bubble bursts. But it will burst. I don't intend to be there when it does, and I won't regret the potential billions I could have made in the mean time. There is potentially functional value with this technology, but there is no economic value.

At some point, the functional value of this technology will be exploited. But it will not be in the form of a currency. The company that can exploit that will be the next Google, but they are not on the investment horizon yet.

Right now, there are penny stock Tea companies (who actually just sell tea) changing their names to "block chain Tea," and realizing a 1,000% appreciation in share price in mere days (less than a week), simply because of a name change.

That's a bubble, my friend, no matter how you want to slice it, semantically.

Exactly... you just said invested. I can invest in playing slot machines too. And when I am up I can say this was a worthwhile investment, but we all know its just gambling.

Bitcoin and others are supposed to be a currency, which needs to be stable, which they are far from. So people are not buying them to use as a currency, especially since any place that does accept them also legally has to accept their local country's currency as well, which they will already have. They are buying them because they see the value going up and don't want to be left out. That is speculation. Its essentially gambling.

Its going to be fun coming back to this thread in a few years when all this implodes, and there are tons of people who will be left crying, the congressional hearings that follow, and eventually these random currencies become sanctioned by governments. Much like the way the US prevents banks and credit card companies from dealing directly with online casinos. Yes, you can get money into and out of them, but it is a pain in the ass and time consuming. I don't doubt something similar will happen with Bitcoin and others.

Exactly... you just said invested. I can invest in playing slot machines too. And when I am up I can say this was a worthwhile investment, but we all know its just gambling.

Bitcoin and others are supposed to be a currency, which needs to be stable, which they are far from. So people are not buying them to use as a currency, especially since any place that does accept them also legally has to accept their local country's currency as well, which they will already have. They are buying them because they see the value going up and don't want to be left out. That is speculation. Its essentially gambling.

Its going to be fun coming back to this thread in a few years when all this implodes, and there are tons of people who will be left crying, the congressional hearings that follow, and eventually these random currencies become sanctioned by governments. Much like the way the US prevents banks and credit card companies from dealing directly with online casinos. Yes, you can get money into and out of them, but it is a pain in the ass and time consuming. I don't doubt something similar will happen with Bitcoin and others.

do you think this downturn in bitcoin's price is fundamentally different than the downturns in 2011, 2013, or 2014? or are cryptocurrencies categorically not able to survive long-term for some particular reason?

Exactly... you just said invested. I can invest in playing slot machines too. And when I am up I can say this was a worthwhile investment, but we all know its just gambling.

Bitcoin and others are supposed to be a currency, which needs to be stable, which they are far from. So people are not buying them to use as a currency, especially since any place that does accept them also legally has to accept their local country's currency as well, which they will already have. They are buying them because they see the value going up and don't want to be left out. That is speculation. Its essentially gambling.

Its going to be fun coming back to this thread in a few years when all this implodes, and there are tons of people who will be left crying, the congressional hearings that follow, and eventually these random currencies become sanctioned by governments. Much like the way the US prevents banks and credit card companies from dealing directly with online casinos. Yes, you can get money into and out of them, but it is a pain in the ass and time consuming. I don't doubt something similar will happen with Bitcoin and others.

do you think this downturn in bitcoin's price is fundamentally different than the downturns in 2011, 2013, or 2014? or are cryptocurrencies categorically not able to survive long-term for some particular reason?

Tulips didn't just disappear when the mania crashed. There is still a market for tulips, it's just a rational market now.

Having said that, bitcoin's swoon today isn't really much different, in magnitude, then what it's had several times this year alone. The bubble could go on for quite a long time, and reach new highs as well. That doesn't mean it's not a bubble. It just means there's enough disagreement about that to keep it going, at least for now.

Exactly... you just said invested. I can invest in playing slot machines too. And when I am up I can say this was a worthwhile investment, but we all know its just gambling.

Bitcoin and others are supposed to be a currency, which needs to be stable, which they are far from. So people are not buying them to use as a currency, especially since any place that does accept them also legally has to accept their local country's currency as well, which they will already have. They are buying them because they see the value going up and don't want to be left out. That is speculation. Its essentially gambling.

Its going to be fun coming back to this thread in a few years when all this implodes, and there are tons of people who will be left crying, the congressional hearings that follow, and eventually these random currencies become sanctioned by governments. Much like the way the US prevents banks and credit card companies from dealing directly with online casinos. Yes, you can get money into and out of them, but it is a pain in the ass and time consuming. I don't doubt something similar will happen with Bitcoin and others.

do you think this downturn in bitcoin's price is fundamentally different than the downturns in 2011, 2013, or 2014? or are cryptocurrencies categorically not able to survive long-term for some particular reason?

For cryptocurrencies to survive as currencies, rather than just vessels for the human speculative impulse, then their value relative to the price of goods needs to remain relatively stable. For that, supply will need to fluctuate to adapt to fluctuating demand. Bitcoin fundamentally can't do that, so IMO, it's already obsolete as a currency. But I don't think it's a stretch at all to think that some other current or future cryptocurrency might eventually be adopted and widely used as a currency - perhaps with a monetary policy administered by some decentralized algorithm, though I have no idea how that might work.

What's a good name for the impending bust? The dotcom era led to the dotbomb. The bitcoin era has a...bitless crash?

Reminds me of the late 90s, when essentially every company that built a web site, became a ".com play" people worked themselves into a lather to buy it. Didn't matter if the company made a profit or even had significant sales. Just needed a .com web site.

Even quaint, mundane little companies. I still remember sometime in 1999? almost falling out of my chair when some analyst called "Vermont Teddy Bear" an internet play because they added a web site, with the resulting ridiculous price surge.

Exactly... you just said invested. I can invest in playing slot machines too. And when I am up I can say this was a worthwhile investment, but we all know its just gambling.

Bitcoin and others are supposed to be a currency, which needs to be stable, which they are far from. So people are not buying them to use as a currency, especially since any place that does accept them also legally has to accept their local country's currency as well, which they will already have. They are buying them because they see the value going up and don't want to be left out. That is speculation. Its essentially gambling.

Its going to be fun coming back to this thread in a few years when all this implodes, and there are tons of people who will be left crying, the congressional hearings that follow, and eventually these random currencies become sanctioned by governments. Much like the way the US prevents banks and credit card companies from dealing directly with online casinos. Yes, you can get money into and out of them, but it is a pain in the ass and time consuming. I don't doubt something similar will happen with Bitcoin and others.

I still haven't been able to find a single store in San Antonio, a city of 1.3 Million people, that accepts Bitcoin. One of the malls has a Bitcoin ATM, but none of the stores in the mall takes Bitcoin.

I also found a Bitcoin ATM at a Quickie Mart type store in SA. I asked if I could pay for my gas, coffee, and chips with Bitcoin. They said "no, we don't accept Bitcoin, we just have the machine for people who want to buy Bitcoin (apparently, they take an 8-10% commission on each Bitcoin purchase)."

Bitcoin is about as much "currency" as a truck load full of anvils. Sure, you might be able to find someone, somewhere who will take that anvil (or Bitcoin) in exchange for a product or service, but it's kinda hard to do so. Not exactly "currency."

I still haven't been able to find a single store in San Antonio, a city of 1.3 Million people, that accepts Bitcoin. One of the malls has a Bitcoin ATM, but none of the stores in the mall takes Bitcoin.

...

Bitcoin is about as much "currency" as a truck load full of anvils. Sure, you might be able to find someone, somewhere who will take that anvil (or Bitcoin) in exchange for a product or service, but it's kinda hard to do so. Not exactly "currency."

How many local stores have you found that accept gold bullion? Does that make it a bad inflation hedge?

I don't invest in BTC, but I have used it for half a dozen online transactions.

Bitcoin scares me. It just seems to be currency speculation without the stability of a currency. The time to buy was a few years ago when it was cheap. It will have to make even more extraordinary gains to make more modest growth.

"Everyone" at my work is talking about it. Their main argument for doing so is "it just keeps going up!" Many have bought small amounts of bitcoin and other so-called crypto-currencies. That tells me if you were a huge investor it is getting close to the time to dump it. Stupid money is being fed into it.

I don't have a dime into it, though I wish when it was around a penny each! LOL

I read one report that said on any given day, approximately 30% of all bitcoin trades involve North Korean money laundering. It's a way for them to avoid UN sanctions on their financial markets.

Just saying. Sometimes operating outside the traditional financial sector isn't quite the moral high ground that some people wish it could be. Are you comfortable supporting a terrorist state, if it could make you money?